I cannot help but be reminded of good ole Nigel every time I talk to clients who are working on their value propositions. A few claims I’ve heard over the years:

·“We are more scalable”

·“We are truly global”

·“We are more adaptive”

Translation? "We go to eleven".

I hear those claims and think to myself, “What prevents their competitors for saying the exact same thing?”

Almost every marketing organization I encounter seems to be making a major effort to differentiate or improve their value propositions.

So, what happens?

A bunch of people (mostly a blend of product or solutions people and marketers) have a series of meetings and wordsmith a set of ideas into a few paragraphs and then say, “If we can only get our sales force to deliver this message, we will outsell our competitors”.

Does this ever pan out? No.

Anything you can say on your website, your competitors can say as well.

Let’s say your value proposition is different than anyone else’s and that you do come up with some concepts that resonate with customers as truly unique and this helps get you traction. How hard is it for your competitors to steal this value proposition, reword it, and use it?

Over the summer, I worked on a large client engagement with other consultants. Michael Tracey (business consultant and Author of Disciplines of Market Leaders), a branding firm, and I were working with a multi-billion dollar vendor on their strategic accounts program. We ran into a lot of problems when we talked about “value propositions.” After much back and forth, we actually discovered there are three levels of message which all must be clearly communicated successfully to produce a value proposition.

·Corporate value – at a high level, how is your company designed to add value, are you a customer centric organization, have the most innovative products or services, or provide the lowest costs? What evidence can you produce to support those?

·Account value – so what? Any customer you are trying to sell to have a tremendous variety of different initiatives and ways to part with that money. They all have their own organizational structures and cultures, how can you give your company an identity to that account where they will take your organization more seriously than all of the other options they have?

·Opportunity value – at the end of the day, customers buy products and services to address discrete problems bounded by a specific scope. While your company can pursue multiple opportunities within any one account, each one must have a clear business case and compelling story to be selected.

Considering these different levels and the need to tailor these messages so they are relevant to a set of people within a given account, perhaps there is a better way to approaching value proposition development. Why not create an inventory of “reference value statements” which are designed specifically to be combined and modified based on the needs of a given account, and create simple tools to allow sales people to configure the right set of messages for a given customer’s requirements? As B2B companies retool their sales models from product-centric to solutions-selling engines, you need to evaluate all legacy back-office processes as well. A logical place to start is where the rubber meets the road – the conversations your sales people have with their clients and prospects.

Comments

Thought-proving post, Scott -- In fact, this is a topic that I'm currently wresting with both professionally as well as on my blog. (I'm in product marketing at a large Enterprise Software company)I see several ways in which companies can properly distinguish themselves (and their value propositions).First, the Value Prop needs to be meaningful for a customer. "More scalable" is not a value proposition, it's a feature. This could be part of a value prop for the right product -- for instance, if solution scalability is of key importance for the target marketSecond, they need to be demonstrably true -- as you mentioned, it's trivial to copy someone else's messaging , something that's all-too-apparent from vendor websites today. "Demonstrably true" means that they must actually be supported by the underlying product's features, and that there are customer proof-points to back this up.Third, they need to tie into the business value that prospects hope to achieve with their initiatives - by connecting them to actual product functionsFinally, this needs to be all brought back full circle, by showing the customer proof of this, in their environment. This validates the entire set of messages for the customer, and increases your company (and sales reps') credibility.Let's make up an example - a company that provides an hardware-accelerated J2EE application server. Typical feature-based messaging would be structured around the ideas of "most scalable", "5x faster than WebLogic", and "100% J2EE Compatible". But a better approach would be something centered around "Deliver Faster Web App performance at Lower Cost". The business problem this target market faces is that it's costing them money to scale up their Web App infrastructure - not only in hardware costs, but in increased operational costs. The business value is that this solutions allows the IT department to more quickly meet business (customer) demands. This needs to be made demonstrably true, by putting customer testimonials on the website. And, the company needs to execute a proof-of-concept with prospects, by benchmarking one of the prospect's applications using the solution. The POC shouldn't just show off the raw performance of the system, but should be used to validate the overall business value of lowered costs - and to make sure the prospect understands what this solutions means in terms of removing barriers to growth.This approach has the value prop as a common thread throughout the sales process, and really works.

Marketing Kvetch - Thanks for participating in our dialog. Our view on this "value proposition" issue is multidimensional and extremely complex. As a product marketer in a large enterprise company, I assume you have corporate positioning that serves as an umbrella for all of products / services. In your role as a product marketer - you are tasked with bringing to life the value of a specific set of capabilities. However, increasingly sales organizations are migrating to team selling models to support targeted accounts and the messaging and value propositions differ based on channel and selling strategy.Two weeks ago, I hosted a "sales enablement" roundtable with sales and marketing executives from 15 leading companies (IBM, Accenture, BearingPoint, Xerox, CSC, BMC, CA, ASG, Orange Business Services, SunGard, Dimmension Data, Siemens, Kronos, Unisys, Dun & Bradstreet). I am in the middle of writing a research report around these topics, but allow me to comment specifically on the issue of value propositions and messages.Companies with large product portfolios have dramatically different challenges than smaller, niche providers.Let’s take growth objectives for example. While it’s true your company could invest resources to cast a net out to drive interest for your products and services – if it did so, it would more or less be operating as a holding company.Most large enterprise firms are focused on achieving profitable growth, which means all of the costs get added together.As sales organizations transform their selling techniques from a product-oriented to a customer-centric approach – the back end support infrastructure (often organized around product or business unit categories) becomes a barrier. One VP of Sales told me "Its like I am trying to mount a solution selling engine on a product selling chassis". This is especially true for account teams who are assigned to large enterprises like UPS (which spends over $1B a year on IT).The issue is very few large enterprises organize themselves they way a vendor organizes their portfolio and their strategic business needs often cut across product or business unit silos.In most cases, the materials developed by product / solutions marketing groups across the portfolio are inconsistent (and often competitive) with each other. This create a tremendous burden on the backs of sales organizations and forces the question – what truly is a value proposition.Don’t get me wrong, I am not pushing back on the idea of POC’s – when done correctly they are fantastic. What I am suggesting is there is ALSO a need to help rationalize value propositions across the board and focused more on the realities that sales teams will encounter when engaged within accounts.I’ve been interviewing executives in end user clients (the people our vendors would like to sell to). One of the questions I’ve been asking is “Vendors are increasingly changing their go-to-market approach to be more solutions based. Have you noticed a difference?”My favorite quote is “their squirrel (solutions approach) is a rat in pretty clothes.”Buyers are consistently telling us that on an individual deal by deal basis they can tell very little difference between vendors and only about 10% of them engage in a truly value-added way. When asked if they spend more with vendors who engage them in a value-added manner – the overwhelming response is yes.My point is that while developing messages for products is important, the low hanging fruit lays with developing configurable messages across the portfolio which sales teams can weave together to tailor a more account-specific value proposition. I’ll write more on this on the blog and provide more detailed examples over time.Thanks for your interest.